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The challenge I’m facing and, I know it’s a good problem, is that the SF real estate has shot up about 35% in the last couple years. I’m sure you’re experiencing the same thing! So as the net worth is rising, the yield on the total portfolio is going down. Right now, it seems the only way to increase the passive income will be to raise the rent in December and to invest some of that cash in stocks, which I’m nervous to do in this market. Current allocation:
The key thing to note in those various streams is how few of them rely on my active participation on a daily basis and how they are fueled from savings. My active participation is in the blogs and $5 Meal Plan. Everything is passive, outside of routine maintenance like updating my net worth record, and none of them would be possible if I didn't have the savings to invest it.
Betterment – Betterment was the first robo-advisor to launch, almost ten years ago. They’ve automated the entire investing process, so all you have to do is watch your portfolio of assets grow (over the long run, of course). They do charge a .25% annual fee of your account total, so if you’ve got $100,000 that’s being managed by Betterment, you’ll pay just over $20 per month.
I’ve now only got a SF rental condo and a Lake Tahoe vacation rental in my real estate rental portfolio. Although I miss my old house, I certainly don’t miss paying $23,000 a year in property taxes, another mortgage, dealing with leaks and managing terrible tenants. I drove by the other day and couldn’t believe how much noisier and busier the street was than where I currently live. I wouldn’t be comfortable raising my son there.
Today, it isn’t enough to just build an app and expect to make millions of dollars from it. Since everyone is doing it, you’ll need to ensure you not only build something great, but that you can also get the proverbial word out. You can make money online with apps today, but it’s definitely harder than it once was, so be sure to set your expectations the right way.
Let’s use Jim from our personal finance example. Jim’s furniture manufacturer builds tables and has several large pieces of equipment in the sawmill used to re-saw logs and boards down to the finished dimensions. The sawmill has net operating revenues of $100,000 for year. The saws in the mill cost Jim a total of $500,000 and he is currently earning a return of 10% in his wholesale table business. Thus, he sets a minimum required return of 10 percent.
Here's another example. If a person owns apartments that are rented out at a profit, they earn money each month without working a specific number of hours. If the owner earns $100/month net income from each apartment, the determining factor is how many apartments they own, not how many hours they work. Therefore, they may own 1 apartment and make $100 net income each month, or they could own 500 apartments and make $50,000 ($100 per apartment) each month.
With that being said it's pretty hard to get traffic quickly, but if you've heard of Amazon FBA you can sell products on there website and basically steal their traffic for your own benefit. This is my main source of income, its online and for the amount of effort I put in, it's pretty easy. (nothing is get rich quick, it does require work) but in terms of every way to make money online, this is probably the fastest and easiest to generate full time income in my opinion.
The obvious way to earn a second income is to get a part-time job. If you are not currently working, this is an excellent way to start as it gives you the freedom and flexibility to start other passive income opportunities. The other option is to simply work from home full time which frees up commute time so you can focus on building more income streams.
Investing in rental properties is an effective way to earn passive income. But it often requires more work than people expect. If you don’t take the time to learn how to make it a profitable venture, you could lose your investment and then some, says John H. Graves, an Accredited Investment Fiduciary (AIF) in the Los Angeles area and author of “The 7% Solution: You Can Afford a Comfortable Retirement.”
For example, you can design digital products, like animal clipart or a downloadable wedding poem that could be printed by the customer. Your design could be resold thousands of times without needing to create each item or ship it. Once you create your digital product and list it on a site like Etsy or Ebay, the revenue flows in with little oversight.
"That's certainly true for entrepreneurs, but even for people who work inside a company, cultivating a side income stream of some sort — whether it's having an Etsy store on the side, or doing a little bit of coaching or having a workshop now and then, whatever it is, doing a little bit of paid speaking — having that sideline gives you additional protection against uncertainty and also has a lot of other benefits.
Many people talk about passive income and create the impression that you never have to do anything to keep that income going. The truth is that you will normally have to keep your eye on things if you want it to run smoothly. For example Richard Branson doesn’t run any of the 400+ companies he started but he goes over the numbers each day to make sure they’re performing well and calls the CEO if there are any problems.